Bennett Harrison

Before his recent death, Bennett Harrison was a professor of urban political economy in the Milano Graduate School of Management and Urban Policy at the New School for Social Research and an affiliated member of the economics faculty.

Continuing the debate from " The Speed Limit ," by Alan S. Blinder, and " Why We Can Grow Faster ," by Barry Bluestone and Bennett Harrison (September-October 1997). Dear Alan : In your recent article [" The Speed Limit : Fact and Fancy in the Growth Debate," TAP , September-October 1997], we very much appreciate your modest, wonderfully humorous, and clearly stated reasoning against betting too heavily on faster growth. We share with you the view that the more capital-friendly tax and regulatory policies advocated by the right (and, increasingly, by the center as well) will not cause the economy to grow faster, in either the short or long run, and would only serve to make the distribution of income between labor and capital even more unequal than it is already. As you will see in this letter, we also share other points of concurrence. But we apparently have an honest disagreement on the central point. We see many signs of a higher potential growth rate; you see growth continuing at...

F rom the early-nineteenth-century introduction of steam power through the dawning of the age of the microchip in the post-World War II era, real economic growth in America averaged 3.8 percent per year. That meant economic output doubled roughly every 19 years. Then after the 1970s, growth collapsed. During the 1980s, growth averaged just 2.7 percent per year and since 1989 only about 2 percent. At that rate, it will take nearly 36 years for gross domestic product (GDP) to double again. Despite this performance at well below historical trend rates, many mainstream economists and the journalists who follow them have concluded that the new lower growth rate is inevitable and more or less permanent. Economist Paul Krugman suggests that we now live in an "age of diminished expectations" and we had better get used to it. The Council of Economic Advisers (CEA) forecasts 2.3 percent growth through 2002. Generally, both the Federal Reserve Board and the Congressional Budget Office agree with...

WORK DISCUSSED IN THIS ESSAY Michael Porter, "Capital Choices: Changing the Way America Invests in Industry," Council on Competitiveness, 1992. Michael Porter, ed.,"Time Horizons of American Industry" (18 pages from the Council on Competitiveness and Harvard Business School, Distributed by HBS June 1992). Paul DiMaggio and Walter W. Powell, eds. The New Institutionalism in Organizational Analysis (University of Chicago Press, 1991). Mark Granovetter, "Economic Action And Social Structure: A Theory of Embeddedness," American Journal of Sociology , 91 (1985). Robert Hayes and William Abernathy, "Managing Our Way to Economic Decline," Harvard Business Review, July-August 1980. Michael T. Jacobs, Short-Term America: The Causes and Cures of Our Business Myopia (Harvard Business School Press, 1991). Michael Porter, The Competitive Advantage of Nations (BasicBooks, 1990). Walter W. Powell, "Neither Market Nor Hieararchy: Network Forms of Organization," in Research in Organizational Behavior...

The competitiveness of the U.S. economy depends on changes inside firms, particularly their willingness to take risks in reshaping four key relationships. Competitiveness, it turns out, depends on new kinds of collaboration.

For both private and government leaders, how to promote American productivity growth in an interdependent global system is the central economic challenge of the 1990s. The decade just passed saw disappointingly slow gains in U.S. productivity low levels of profit, investment, and economic growth, and consequent stagnation in average wages. Companies based in the United States often found themselves unable to match Japanese, German, Italian, and Scandinavian competitors in their ability to put new technologies in practice, to bring new products to market, or to upgrade their work force. Can America -- and American business -- do better in the 1990s? High public deficits and low private savings have figured prominently in the standard explanations of slow growth. Those who look beneath the macroeconomic level at institutional and structural causes have mainly stressed reform of education and other measures to improve human capital. We have no quarrel with educational reform, as long as...